Dive Brief:
- Puerto Rico can meet 100% of its projected electricity needs with renewable energy by 2050, in compliance with the territory’s Act 17 law, the U.S. Department of Energy concluded in a two-year study published Wednesday. The transition could drive up energy rates, however, requiring a “strategic plan” to control bill impacts.
- In the near-term, DOE officials say about 400 MW of new capacity is needed to stabilize the island’s electric grid and address current generation shortfalls. Both utility-scale and distributed renewable resources are required, along with significant amounts of energy storage.
- Alongside results of the study, dubbed PR100, DOE also announced that later this month Puerto Rico residents can apply for the agency’s Programa Acceso Solar, which aims to supply 30,000 low-income households with rooftop solar and battery storage systems.
Dive Insight:
Puerto Rico’s transition to renewable energy “will be a substantial effort, and won't happen overnight, but 100% clean energy is 100% possible,” Agustín Carbó, director of DOE’s Puerto Rico Grid Recovery and Modernization Team, said in a call with reporters on Tuesday.
The PR100 study assessed the land requirements and technical potential for utility-scale solar, land-based wind and offshore wind, among other technologies. The study was published by DOE’s National Renewable Energy Laboratory and takes into account the island’s financial situation and the bankruptcy of its electric utility, the Puerto Rico Electric Power Authority, known as PREPA.
“Renewable energy resource potential assessed for Puerto Rico exceeds by more than tenfold what is required to meet the current and projected total annual loads through 2050,” according to a summary of the study provided to reporters. “Moreover, electric load can be met with mature technologies, such as distributed PV, utility-scale PV, utility-scale wind, storage, and reciprocating engines running on biofuels.”
Utility-scale PV deployment on non-agricultural land “is sufficient to meet total annual electric load to 2050 in our scenarios,” NREL concluded.
The study also concluded that “additional generation capacity is needed immediately — on the scale of hundreds of megawatts — to achieve system adequacy and minimize outages.”
Even if all of PREPA’s renewable energy and storage procurements result in their planned capacity additions, “a significant investment in additional generation capacity would still be needed to achieve acceptable reliability performance,” the report found.
To achieve 40% renewable energy, which Puerto Rico law requires by 2025, DOE concluded the optimal approach includes up to 3,500 MW of utility-scale solar capacity, depending on scenario inputs, along
with approximately 700 MW of 4-hour-duration utility-scale batteries, up to 400 MW of long-duration storage, and up to 340 MW of land-based wind. The utility-scale capacity additions add to the distributed renewables and storage additions, NREL expects.
However, researchers also noted the speed of additions will need to pick up. “The current pace of utility-scale deployment is likely too slow to result in 40% renewable energy by the 2025 statutory deadline and a reliable grid in the near term,” the report found.
Much of the island’s approximately 4 GW of existing fossil fuel generation would remain online during this initial renewables buildout, according to the study.
Puerto Rico customers paid about $0.25/kWh for their electricity in October, according to EIA data, significantly higher than mainland U.S. prices. The cost of new clean energy resources “will be significant regardless of the mix of generation technologies,” the report warned.
Under one scenario that leans on cheaper utility-scale solar generation, Puerto Rico electricity prices rise to about $0.32/kWh in 2025 and $0.35/kWh in 2050. The study found households earning $15,000 per year or less “were particularly vulnerable” to large retail rate increases, “especially if they were more likely to be nonadopters of
rooftop PV, resulting in energy justice implications,” the report found.
DOE’s accessible solar program, which launches Feb. 22, aims to address energy affordability issues by helping low-income customers in Puerto Rico install rooftop solar and energy storage with zero upfront costs. Funding for the program comes from the $1 billion DOE Puerto Rico Energy Resilience Fund.
The DOE loan program office “is also working with independent power developers in Puerto Rico to offer federally-backed loans and loan guarantees with low interest rates so that utility-scale solar PV generation and battery storage projects can be built at a low cost to consumers,” Carbó said.
